UNITED STATES
                 SECURITIES AND EXCHANGE COMMISSION
                       Washington, D.C.  20549

                              FORM 10-Q

(Mark One)

[X]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
            OF THE SECURITIES EXCHANGE ACT OF 1934

            For the quarterly period ended March 31, 2001

                                 OR

[ ]     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
                   OF THE SECURITIES EXCHANGE ACT OF 1934

         For the transition period from ________ to ________

                   Commission File Number 1-15907

                   RIGHTCHOICE MANAGED CARE, INC.
       (Exact name of registrant as specified in its charter)

                Delaware                           43-0303080
     (State or other jurisdiction of      (IRS Employer Identification No.)
      incorporation or organization)

1831 Chestnut Street, St. Louis, Missouri         63103-2275
 (Address of principal executive offices)         (Zip Code)

Registrant's telephone number, including area code (314) 923-4444


                       Not Applicable
    (Former name, former address and former fiscal year,
                if changed since last report)

      Indicate by check mark whether the registrant (1) has
filed all reports required to be filed by Section 13 or 15(d)
of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.   Yes [X] No [ ]

     Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable date:

          Title of each class           Outstanding at May 10, 2001

      Common stock, $0.01 par value         19,501,062 shares



                   RIGHTCHOICE MANAGED CARE, INC.
                    First Quarter 2001 Form 10-Q
                          Table of Contents



PART  I.      FINANCIAL INFORMATION                                   PAGE

     ITEM 1.  Financial Statements

              Consolidated Balance Sheets as of March 31, 2001
                 and December 31, 2000                                  3

              Consolidated Statements of Income for the three months
                 ended March 31, 2001 and 2000                          4

              Consolidated Statements of Changes in Stockholders' Equity
                 for the three months ended March 31, 2001 and 2000     5

              Consolidated Statements of Cash Flows for the three months
                 ended March 31, 2001 and 2000                          6

              Notes to Consolidated Financial Statements                7

     ITEM 2.  Management's Discussion and Analysis of Financial Condition
                 and Results of Operations                             14

     ITEM 3.  Quantitative and Qualitative Disclosures About
                 Market Risks                                          22

PART II.      OTHER INFORMATION

     ITEM 1.  Legal Proceedings                                        23

     ITEM 2.  Changes in Securities and Use of Proceeds                23

     ITEM 3.  Defaults Upon Senior Securities                          23

     ITEM 4.  Submission of Matters to a Vote of Security Holders      23

     ITEM 5.  Other Information                                        23

     ITEM 6.  Exhibits and Reports on Form 8-K                         23

SIGNATURES                                                             24







PART I.     FINANCIAL INFORMATION
ITEM 1.     Financial Statements

                   RIGHTCHOICE MANAGED CARE, INC.
                     CONSOLIDATED BALANCE SHEETS
          (in thousands, except shares and per share data)

               ASSETS                 March 31,    December 31,
                                        2001           2000
                                     (unaudited)
Current assets:
  Cash and cash equivalents            $50,339       $56,026
  Investments available for sale,
     at market value                   280,797       262,039
  Receivables, net of allowances       124,481       132,260
  Deferred income taxes                  9,584        10,430
  Other assets                          21,776        18,798
    Total current assets               486,977       479,553
Property and equipment, net            110,872       110,010
Deferred income taxes                    6,907         5,413
Investments in affiliates                6,635         6,475
Goodwill and intangible assets, net     90,341        91,963
    Total assets                      $701,732      $693,414


   LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Medical claims payable              $142,304      $145,980
  Unearned premiums                     68,470        69,073
  Accounts payable and accrued expenses 79,014        88,720
  Current portion of long-term debt     24,063         6,000
  Obligations for employee benefits      1,625         1,574
  Income taxes payable                  29,289        20,938
  Current portion of obligations
     under capital leases                4,196         3,883
     Total current liabilities         348,961       336,168
Long-term debt                                        20,063
Obligations for employee benefits       30,513        29,554
Obligations under capital leases         4,796         4,860
     Total liabilities                 384,270       390,645

Stockholders' equity:
  Preferred stock, $0.01 par,
     25,000,000 shares authorized,
     no shares issued and outstanding
  Common stock, $0.01 par,
     225,000,000 shares authorized,
     18,744,343 and 18,696,040 shares
     issued, respectively, 18,744,343
     and 18,678,503 shares outstanding,
     respectively                          187           187
  Additional paid-in capital           301,184       300,317
  Retained earnings                     16,773         3,976
  Treasury stock, 0 and 17,537 shares,
     respectively, at cost                             (234)
  Accumulated other comprehensive loss   (682)       (1,477)
     Total stockholders' equity        317,462       302,769
     Total liabilities and
        stockholders' equity          $701,732      $693,414


    See accompanying Notes to Consolidated Financial Statements.


                   RIGHTCHOICE MANAGED CARE, INC.
            CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
          (in thousands, except shares and per share data)

                                        Three months ended March 31,
                                             2001         2000
 Revenues:
    Premium                                $246,821    $220,342
    Fees and other income                    34,765      29,285
       Total revenues                       281,586     249,627

 Operating expenses:
    Health care services                    200,753     179,318
    Commissions                              10,474       8,948
    General and administrative (excludes
       depreciation and amortization)        47,890      43,826
    Depreciation and amortization             5,469       5,047
       Total operating expenses             264,586     237,139
 Operating income                            17,000      12,488

 Investment income:
    Interest and dividends                    4,362       3,958
    Realized gains, net                         739         139
       Total investment income, net           5,101       4,097

 Other:
    Interest expense                          (782)       (913)
    Other expense, net                         (45)        (14)
       Total other, net                       (827)       (927)

 Income before minority interest and
    provision for income taxes               21,274      15,658

 Minority interest in consolidated
    subsidiary                                          (1,468)

 Provision for income taxes                 (8,477)     (6,348)

 Net income                                 $12,797      $7,842

 Weighted average common shares
    outstanding                          18,719,091  14,962,500
 Potential dilutive common shares           477,479     236,528
 Basic earnings per share                     $0.68       $0.52
 Diluted earnings per share                   $0.67       $0.52

     See accompanying Notes to Consolidated Financial Statements.

<TABLE>
                                                  RIGHTCHOICE MANAGED CARE, INC.
                                                CONSOLIDATED STATEMENTS OF CHANGES
                                                IN STOCKHOLDERS' EQUITY (UNAUDITED)
                                                  (in thousands, except shares)

                                                                                               Net
                                                                                             assets        Accumulated
                                                         Additional                       available for       other
                                                Common    paid-in    Retained   Treasury  the benefit of  comprehensive
                                                 stock    capital    earnings     stock      members          loss          Total
<S>                                             <C>      <C>         <C>        <C>       <C>             <C>               <C>
Balance at
   December 31, 1999                                                                         $217,281        $(3,557)      $213,724


Comprehensive income:

   Net income                                                                                   7,842                         7,842

   Change in unrealized depreciation
   on available-for-sale securities,
   net of income tax provision of $237
   and net of minority interest charge of $74                                                                     294           294
                                                                                                                            -------
Comprehensive income                                                                                                          8,136

Other                                                                                               2                             2

Balance at
   March 31, 2000                                                                             225,125         (3,263)       221,862


Comprehensive income:

   Net income                                                          $3,976                  23,708                        27,684

   Change in unrealized depreciation
   on available-for-sale securities,
   net of income tax provision of $1,507
   and net of minority interest charge of $323                                                                  2,322         2,322

   Minimum pension liability
   adjustment, net of income tax
   benefit of $33                                                                                                (63)          (63)
                                                                                                                            -------
Comprehensive income                                                                                                         29,943

Other                                                                                             116                           116

Payment to The Missouri
Foundation For Health                                                                        (12,780)                      (12,780)

Issuance of common stock
pursuant to the
Reorganization                                    $187    $300,277               $(490)     (236,169)           (473)        63,332

Common shares issued
under the company's stock
option plan subsequent to
the Reorganization                                              40                  256                                         296

Balance at
   December 31, 2000                               187     300,317      3,976     (234)             0         (1,477)       302,769


Comprehensive income:

   Net income                                                          12,797                                                12,797

   Change in unrealized depreciation
   on available-for-sale securities,
   net of income tax provision of $475                                                                            795           795
                                                                                                                            -------
Comprehensive income                                                                                                         13,592

65,840 common shares issued
under the company's stock
option plan                                                    867                  234                                       1,101

Balance at
   March 31, 2001                                 $187    $301,184    $16,773        $0            $0          $(682)      $317,462

    See accompanying Notes to Consolidated Financial Statements.
</TABLE>


                   RIGHTCHOICE MANAGED CARE, INC.
          CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                           (in thousands)

                                         For the three months ended March 31,
                                                  2001          2000
Cash flows from operating activities:
   Net income                                   $12,797         $7,842
   Adjustments to reconcile net income
     to net cash provided by operating
     activities:
     Benefit for deferred income taxes          (1,123)          (720)
     Depreciation and amortization                5,469          5,047
     Undistributed earnings of affiliates         (160)          (203)
     Gain on sale of investments                  (739)          (139)
     Amortization of premiums and
        accretion of discounts, net                  20           (93)
     (Gain) loss on sale of property
        and equipment                              (31)              1
     Minority interest in consolidated
        subsidiary                                               1,468
   Decrease (increase) in certain assets:
     Receivables                                  7,779       (10,984)
     Other assets                               (2,697)            240
   (Decrease) increase in certain liabilities:
     Medical claims payable                     (3,676)        (1,407)
     Unearned premiums                            (603)          2,026
     Accounts payable and accrued expenses      (9,706)        (4,336)
     Reserve for loss contract                                   (315)
     Obligations for employee benefits            1,010            530
     Income taxes payable                         9,237          7,040
Net cash provided by operating activities        17,577          5,997
Cash flows from investing activities:
   Proceeds from matured investments:
     Fixed maturities                             9,493         13,159
   Proceeds from investments sold:
     Fixed maturities                            68,274          7,537
     Equity securities                              618
     Other                                          530            513
   Investments purchased:
     Fixed maturities                          (94,703)       (23,423)
     Equity securities                            (731)        (5,118)
   Proceeds from property and
      equipment sold                                 31
   Property and equipment purchased             (3,925)        (2,267)
Net cash used in investing activities          (20,413)        (9,599)
Cash flows from financing activities:
   Issuance of common stock under
      stock plans                                   215              3
   Payments of long-term debt                   (2,000)        (2,000)
   Payments of capital lease
      obligations                               (1,066)        (1,245)
Net cash used in financing activities           (2,851)        (3,242)
Net decrease in cash and cash equivalents       (5,687)        (6,844)
Cash and cash equivalents at beginning of
   period                                        56,026         63,477
Cash and cash equivalents at end of period      $50,339        $56,633
Supplemental Disclosure of Cash Information:
   Interest paid                                   $788           $913
   Income taxes paid, net                           362             29
Supplemental Schedule of Noncash
Investing and Financing Activities:
   Equipment acquired through capital leases      1,315            269

    See accompanying Notes to Consolidated Financial Statements.


                   RightCHOICE Managed Care, Inc.
             Notes to Consolidated Financial Statements
                             (unaudited)


1.      Financial statement presentation

The interim consolidated financial statements included herein
have been prepared by RightCHOICE Managed Care, Inc., a Delaware
corporation (RightCHOICE or the company), without audit, pursuant
to the rules and regulations of the Securities and Exchange
Commission (the SEC).  Certain information and footnote
disclosures, normally included in the financial statements
prepared in accordance with generally accepted accounting
principles, have been condensed or omitted pursuant to such SEC
rules and regulations; however, the management of the company
believes that the disclosures herein are adequate to make the
information presented not misleading.  In the opinion of
management, all adjustments, consisting only of normal recurring
adjustments necessary to present fairly the consolidated
financial position of the company with respect to the interim
consolidated financial statements, and the consolidated results
of its operations and its cash flows for the interim periods then
ended, have been included.  The results of operations for the
interim periods are not necessarily indicative of the results for
the full year.

2.      Organization

RightCHOICE is the largest provider of health care benefits in
the state of Missouri in terms of members.  The company offers a
comprehensive array of managed health care products and services,
including preferred provider organizations (PPO), point of
service (POS), health maintenance organizations (HMO), Medicare
supplement, specialty managed care, short-term medical and
managed indemnity benefit plans, third-party administrator (TPA)
services, administrative services only (ASO), network rental
services and life insurance agency services.  The company offers
these products and services to large and small employers as well
as individuals.

On November 30, 2000, the company completed a series of
transactions (collectively, the Reorganization) pursuant to the
Agreement and Plan of Reorganization, dated as of March 14, 2000,
by and among Blue Cross and Blue Shield of Missouri (BCBSMo),
RightCHOICE Managed Care, Inc., a Missouri corporation (Old
RightCHOICE), The Missouri Foundation For Health (the
Foundation), and RightCHOICE.  In connection with the
Reorganization, (a) BCBSMo transferred its insurance contracts
and associated assets and liabilities to Healthy Alliance Life
Insurance Company, a subsidiary of Old RightCHOICE, (b) BCBSMo
converted from a Missouri non-profit non-stock health services
corporation to a Missouri for-profit stock corporation by
amending its charter documents, (c) BCBSMo then issued one share
of its common stock to the Foundation, (d) BCBSMo reincorporated
as a Delaware corporation by merging with RightCHOICE, which the
Foundation owned at the time, and (e) Old RightCHOICE merged with
RightCHOICE with RightCHOICE emerging as the surviving
corporation in the merger.  The last step of this transaction
resulted in the following: (a) the class A stockholders of Old
RightCHOICE received an equal number of shares of RightCHOICE in
exchange for their shares of Old RightCHOICE, (b) each
outstanding share of Old RightCHOICE class B common stock was
cancelled, and (c) the one outstanding share of RightCHOICE
common stock owned by the Foundation was converted into
14,962,500 shares of RightCHOICE common stock.  Also, immediately
prior to the Reorganization, BCBSMo paid $12.8 million to the
Foundation in partial satisfaction of claims by various parties.

RightCHOICE accounted for the Reorganization in a manner similar
to a pooling of interests transaction except for (1) the class A
stockholders' exchange of their minority ownership of Old
RightCHOICE class A common stock for RightCHOICE common stock and
(2) the exchange of options to purchase shares of Old RightCHOICE
class A common stock for options to purchase shares of
RightCHOICE common stock.  RightCHOICE accounted for these
exchanges of shares and options as a purchase.  In connection
with this purchase accounting treatment, RightCHOICE recorded
goodwill and intangible assets of $25.3 million as of November
30, 2000, the effective date of the Reorganization.  In addition,
upon issuance of the RightCHOICE shares to the minority
stockholders of Old RightCHOICE, the minority stockholders'
interest in the net assets of Old RightCHOICE of $38.0 million
was eliminated from the Consolidated Balance Sheet.  The net
change to stockholders' equity due to the Reorganization is a
combination of these two items - goodwill and intangible asset
recognition and minority interest elimination - which total $63.3
million.

Upon completion of the Reorganization on November 30, 2000, there
were 18,659,300 outstanding common shares of RightCHOICE, of
which 14,962,500 shares (or approximately 80%) were held
beneficially by the Foundation.  As of March 31, 2001, there were
18,744,343 shares outstanding of which 14,962,500 shares (or
approximately 80%) were held beneficially by the Foundation.  The
Foundation had approximately 80% of the voting power of
RightCHOICE at March 31, 2001, although a voting trust held
approximately 94% of the Foundation's shares at March 31, 2001.
The Foundation will vote and sell shares as required by the
voting trust and divestiture agreement.

See Note 9, "Unaudited pro forma financial information," for
additional information related to the Reorganization referred to
above.

3.      Contingencies

Litigation with the Missouri Attorney General and Missouri
Department of Insurance

As a result of the reorganization and related settlement that
occurred on November 30, 2000, Old RightCHOICE and Blue Cross and
Blue Shield of Missouri and their affiliates, on the one hand,
and the state of Missouri, on the other hand, have resolved all
of their outstanding litigation and regulatory issues related to
Blue Cross and Blue Shield of Missouri's operation of Old
RightCHOICE following the organization of Old RightCHOICE in
1994.  There remains pending, however, the appeal of a judgement
related to the corporate status of Blue Cross and Blue Shield of
Missouri described below under "Litigation relating to corporate
status of Blue Cross and Blue Shield of Missouri."

Litigation relating to corporate status of Blue Cross and Blue
Shield of Missouri

On November 3, 1997, our predecessor, Blue Cross and Blue Shield
of Missouri, filed an action in the Circuit Court of Cole County,
Missouri against the Missouri Attorney General seeking
declarations that (1) Blue Cross and Blue Shield of Missouri was
a mutual benefit type of non-profit corporation, and (2) Blue
Cross and Blue Shield of Missouri did not hold its assets in
constructive, charitable, or other trust for the benefit of the
public generally but rather held its assets for the benefit of
its subscribers.  The Missouri Attorney General filed an answer
and counterclaim seeking a declaration that Blue Cross and Blue
Shield of Missouri is a public benefit type of non-profit
corporation.

Two individuals who are or have been subscribers of Blue Cross
and Blue Shield of Missouri moved to intervene and then were
joined in this action as parties contending that Blue Cross and
Blue Shield of Missouri was a mutual benefit corporation, that
its assets should not be transferred to a charitable trust or
other charitable organization such as The Missouri Foundation For
Health and that the existing parties to the action would not
adequately represent their interests in the resolution of the
question whether Blue Cross and Blue Shield of Missouri is a
public benefit or a mutual benefit corporation.

On November 3, 2000, the circuit court entered a judgment finding
that Blue Cross and Blue Shield of Missouri is a public benefit
corporation.  This ruling was consistent with the positions
ultimately taken by all parties to our settlement agreement.

One of the two individuals appealed the circuit court's judgment
of November 3, 2000.  If the circuit court's judgment is
reversed, our company, as successor to Blue Cross and Blue Shield
of Missouri, could be obligated to pay substantial money damages.
It is also possible that if the circuit court's judgment is
reversed, a court could order the reorganization be rescinded as
if it never happened, although we believe that this would be
unlikely.  If a court enters those orders or orders like those,
it would have a material adverse effect on us.

Litigation relating to Medicare supplement premiums

Our predecessor, Blue Cross and Blue Shield of Missouri, was a
party to a class action lawsuit originally filed in August 1995
in St. Louis City Circuit Court against both Blue Cross and Blue
Shield of Missouri and Old RightCHOICE.  The plaintiffs were
subscribers to Medicare supplement policies that Blue Cross and
Blue Shield of Missouri issued from July 1, 1992 through
August 10, 1994 and sought to represent a class of all
subscribers during those years.

The subscribers fell into two groups, those holding standardized
Medicare supplement policies and those holding pre-standardized
Medicare supplement policies.  Both plaintiffs claimed that from
July 1, 1992 through August 10, 1994 Blue Cross and Blue Shield
of Missouri collected premiums on Medicare supplement policies
that were in excess of the premiums approved by the Missouri
Department of Insurance in violation of the contracts between
Blue Cross and Blue Shield of Missouri and its members.  The
plaintiffs also claimed that Blue Cross and Blue Shield of
Missouri made fraudulent representations about these premium
increases.  While Blue Cross and Blue Shield of Missouri won
summary judgment in the trial court and appellate court, the
Missouri Supreme Court reversed in part and remanded in part the
case to the trial court.  The plaintiffs claimed that Blue Cross
and Blue Shield of Missouri collected allegedly unauthorized
premiums totaling more than $29 million.  They sought recovery of
at least that amount as damages, plus prejudgment interest and
punitive damages.  The representative of subscribers holding pre-
standardized policies was disqualified by the circuit court from
service as class representative due to ill health.

In December 2000, the circuit court conducted a hearing on the
plaintiffs' motion for class certification and Blue Cross and
Blue Shield of Missouri's partial motions to dismiss or for
summary judgment.  After the hearing, and while the motions were
pending, the class representative of subscribers holding pre-
standardized Medicare supplement policies voluntarily dismissed
her claim.  She also dismissed without prejudice the claims she
had sought to make on behalf of other pre-standardized plan
subscribers.  The pre-standardized policies represent
approximately $27 million of the approximately $29 million in
allegedly unauthorized premiums.  As a result of the dismissal by
the class representative, there are now no claims pending on
behalf of holders of the pre-standardized policies.  There can be
no assurance, however, that a new claim will not be asserted on
their behalf.  The plaintiffs' motion for certification of a
class of standardized plan subscribers as well as the partial
motion to dismiss on behalf of Blue Cross and Blue Shield of
Missouri have been argued and are now under submission.  As
successor to Blue Cross and Blue Shield of Missouri, we are now
the defendant in that action.  An adverse decision in this
lawsuit could subject us to substantial damages.

Other contingencies

In addition to the matters described above, from time to time in
the ordinary course of business, RightCHOICE and certain of its
subsidiaries are parties to various legal proceedings, including
the claims of its members and its subsidiaries' members arising
from health plan benefit coverage issues for certain services
under evolving theories of liability.  The financial and
operational impact that such evolving theories of recovery will
have on the managed care industry generally, or RightCHOICE in
particular, is presently unknown.

4.      Recently issued accounting standards

In June 1998, the Financial Accounting Standards Board released
Statement of Financial Accounting Standards (SFAS) No. 133,
"Accounting for Derivative Instruments and Hedging Activities."
SFAS No. 133 establishes standards for derivative instruments,
including certain derivative instruments embedded in other
contracts, and for hedging activities.  It requires an entity to
recognize all derivatives as either assets or liabilities in the
statement of financial position and measures those instruments at
fair value.  SFAS No. 133 is effective for all fiscal years
beginning after June 15, 2000, as extended by SFAS No. 137.
Earlier application of SFAS No. 133 is encouraged but should not
be applied retroactively to financial statements of prior
periods.  The adoption of SFAS No. 133 did not have a material
impact on the company's financial position or results of
operations.  The company has minimal use of derivatives as
defined by SFAS No. 133 and does not use derivatives for hedging
activities.

RightCHOICE's subsidiaries, Healthy Alliance Life Insurance
Company, HMO Missouri, Inc., HealthLink HMO, Inc., and
RightCHOICE Insurance Company, file statutory-based financial
statements with the Departments of Insurance of the states with
which they do business.  On January 1, 2001, significant changes
to the statutory basis of accounting became effective.  The
cumulative effect of these changes, known as the Codification of
Statutory Accounting Principles guidance (the Codification), will
be recorded as a direct adjustment to the statutory surplus of
the company's subsidiaries. The company's adoption of the
Codification did not have a material adverse effect on the
company or its subsidiaries.  The statutory surplus of the
company's subsidiaries after adoption of the Codification
continues to be in excess of the regulatory risk-based capital
requirements.

5.      Provision for income taxes

The company's effective income tax provision rate was 39.8% and
40.5% for the first quarters of 2001 and 2000, respectively.  The
effective tax provision rates for the first quarters of 2001 and
2000 were affected by non-deductible goodwill amortization, among
other things.  SFAS No. 109, "Accounting for Income Taxes,"
requires a valuation allowance against deferred tax assets if,
based on the weight of available evidence, it is more likely than
not that some or all of the deferred tax assets will not be
realized.  Based upon all the available evidence, management
believes it is more likely than not that the company will realize
its deferred tax assets as of March 31, 2001, and, accordingly,
no valuation allowance has been provided against such assets as
of March 31, 2001.

6.      Earnings per share

Basic earnings per share are computed by dividing net income by
the weighted average number of common and common equivalent
shares outstanding during the year.  Diluted earnings per share
are calculated by dividing net income by the number of weighted
average shares outstanding plus additional shares representing
stock distributable under stock-based compensation plans using
the treasury stock method.  Share and per share data for the
first quarter of 2000 give effect to the Reorganization (see Note
2, "Organization," above) in a manner similar to a stock split
(i.e. as if the 14,962,500 shares of RightCHOICE existed for all
prior periods before the Reorganization was completed in place of
the one share of RightCHOICE that the Foundation owned prior to
the Reorganization).  Because the Reorganization was accounted
for in a manner similar to a pooling of interests, except for the
exchange of the 3.7 million shares of class A common stock held
by the public minority stockholders of Old RightCHOICE and the
exchange of options to purchase shares of Old RightCHOICE for
options to purchase shares of RightCHOICE, the weighted average
shares outstanding used for computing the first quarter of 2000
earnings per share consist only of the 14,962,500 shares owned by
the Foundation.  For the first quarter of 2001, weighted average
shares outstanding consist of the 14,962,500 shares plus
approximately 3.7 million common shares issued to the former
public minority stockholders of Old RightCHOICE on November 30,
2000, the date of the Reorganization, plus approximately 0.1
million shares issued subsequent to the Reorganization pursuant
to stock-based compensation plans.  There were 477,479, and
236,528 potential dilutive common shares for the first quarters
of 2001 and 2000, respectively.

7.      Comprehensive income

The components of other comprehensive income related to the
unrealized gains on RightCHOICE's available-for-sale securities
for the three month periods ended March 31, 2001 and 2000 are as
follows:

                                                 Three months ended March 31,
                                                       2001       2000
                                                        (in thousands)
Unrealized holding gains arising during
        period, net of taxes and minority interest      $1,279      $385
Less:   reclassification adjustment for
        gains included in net income, net of taxes       (484)      (91)
Net unrealized gains on securities, net
        of taxes and minority interest                    $795      $294


The components of accumulated other comprehensive loss on the
Consolidated Balance Sheets include unrealized net (depreciation)
appreciation of investments as well as a minimum pension
liability adjustment.  The unrealized net depreciation of
investments, net of taxes, was $324 and $1,119 at March 31, 2001
and December 31, 2000, respectively.  The minimum pension
liability increase, net of taxes, was $358 and $358 at March 31,
2001 and December 31, 2000, respectively.

8.  Segment information

The company operates in three segments, which it defines as
underwritten, self-funded, and other.  The company's underwritten
segment includes a comprehensive array of products including PPO,
POS, HMO, Medicare supplement, managed indemnity, specialty
managed care and short-term medical coverages.  The company's
self-funded segment includes TPA, ASO for self-insured
organizations, network rental services for self-insured
organizations, insurance companies and other organizations,
including network rental for workers' compensation, national
service accounts through the Blue Cross Blue Shield Association
for which RightCHOICE accepts no underwriting risk, and life
insurance agency services.  The other segment primarily includes
the company's real estate assets and related rental and lease
revenues and expenses.  All of the company's revenues, including
underwritten premiums and self-funded fees and other income and
real estate revenue, are derived from domestic (United States)
sources, and no single customer accounts for more than 10% of
total revenues.

Operating income for the company's underwritten segment is
determined by deducting from premium revenue the health care
service costs, commissions, and general and administrative
expenses that are attributable to that segment's operations.
Operating income for the self-funded segment is determined by
deducting from fees and other income the commissions and general
and administrative expenses attributable to the segment.
Operating income for the other segment is determined by deducting
from rental revenues the general and administrative expenses
(including depreciation) attributable to the segment.  Expenses
not directly traceable to an industry segment are allocated on a
consistent and reasonable basis utilizing membership, groups,
claims, and other key drivers.  Net investment income is
allocated to segments separately for each subsidiary of the
company based on the amount of segment revenue generated at each
entity.  Net investment income of the parent company is allocated
to segments based on the company's total consolidated
underwritten and self-funded segment revenue.  Corporate
identifiable assets for the underwritten and self-funded segments
include only receivables because the company does not produce more
detailed information by segment internally.  Corporate identifiable
assets for the company's other segment includes the net book value
of the company's real estate and related assets.  Intersegment
revenues include the rental income related to the company's corporate
headquarters.  This related party transaction is eliminated in the
company's Consolidated Financial Statements.  Financial information
by segment is as follows (in thousands):

As of and for the
three months ended                 Self-
March 31, 2001      Underwritten  funded     Other   Eliminations Consolidated
Revenues              $246,921    $33,833    $2,032    $(1,200)   $281,586
Operating income         2,880     13,299       821                 17,000
Investment income, net   4,721        380                            5,101
Depreciation and
amortization expense     3,254      1,503       712                  5,469
Identifiable assets     83,963     40,518    58,471                182,952


As of and for the
three months ended                 Self-
March 31, 2000      Underwritten  funded     Other   Eliminations Consolidated
Revenues              $220,342    $28,632    $1,919    $(1,266)   $249,627
Operating income         2,178      9,533       777                 12,488
Investment income, net   3,781        316                            4,097
Depreciation and
amortization expense     2,936      1,398       713                  5,047
Identifiable assets     70,380     36,064    61,282                167,726

9.  Unaudited pro forma financial information

In accordance with Accounting Principles Board Opinion 16,
"Business Combinations", the following unaudited pro forma
summary for the first quarter of 2000 presents revenues,
operating income, net income and per share data of RightCHOICE as
if the Reorganization had occurred as of the beginning of the
quarter.  The pro forma information includes the results of
operations of BCBSMo combined with Old RightCHOICE.  In addition,
results include amortization of intangible assets resulting from
the Reorganization, additional premium tax expense for the
underwritten business of BCBSMo that was not previously subject
to premium tax, foregone interest on the cash that was paid to
the Foundation, and the related income tax effects of such
adjustments.  In addition, the results below exclude the
reduction of expense in the first quarter of 2000 of
approximately $0.3 million (before tax), which was primarily due
to a change in estimate for certain external legal costs related
to the Reorganization based upon the resolution of certain legal
fee obligations determined after the end of 1999, along with the
related tax effect of such expense reduction.  The charge for the
minority stockholders' interest in Old RightCHOICE has been
excluded because the information below assumes the Reorganization
took place at the beginning of the first quarter of 2000.  The
pro forma financial information is presented for informational
purposes only and may not be indicative of the results of
operations as they would have been if BCBSMo and Old RightCHOICE
had been a single entity during the quarter ended March 31, 2000,
nor is it indicative of the results of operations which may occur
in the future.  Pro forma basic earnings per share is calculated
based on approximately 18.6 million shares for the first quarter
of 2000.  Pro forma diluted earnings per share is calculated
based on approximately 18.9 million shares for the first quarter
of 2000.  First quarter 2001 actual results are included for
comparative purposes.

(unaudited)                          Three months ended
                                          March 31,
                                       2001        2000
                                     (actual)  (pro forma)
Revenues                            $281,586    $249,627
Operating income                      17,000      11,490
Net income                            12,797       8,200
Basic earnings per share               $0.68       $0.44
Diluted earnings per share              0.67        0.43

10. Subsequent events

On May 7, 2001, the Foundation and the company completed a sale
of 4,000,000 shares of common stock of the company.  Of the
total, 3,250,000 shares were sold by the Foundation.  RightCHOICE
did not receive any proceeds from this sale of shares by the
Foundation.  The company sold 750,000 shares of RightCHOICE
common stock which resulted in net proceeds to the company of
approximately $26.6 million after deducting the underwriting
discounts and commissions and other expenses.  The proceeds of
the sale of these shares were used primarily to repay the
remaining $24.1 million of borrowed funds outstanding under the
company's credit facility.  Upon repayment of these borrowings on
May 7, 2001, the company's credit facility was terminated.  The
remaining net proceeds from the company's stock sale will be used
for capital expenditures and other general corporate purposes.
On May 10, 2001, the Foundation sold an additional 600,000 shares
pursuant to the underwriters' over-allotment option.  RightCHOICE
did not receive any proceeds from this sale of shares by the
Foundation.  After these sales, the Foundation owned
approximately 11.1 million shares, or approximately 57% of the
company's outstanding common stock as of May 10, 2001.  A voting
trust holds approximately 92% of the Foundation's shares as of
May 10, 2001.

ITEM 2.     Management's Discussion and Analysis
            of Financial Condition and Results of Operations

The following discussion should be read in conjunction with the
consolidated financial statements and notes thereto.

Except for the historical information included herein, this
Report includes forward-looking statements that involve risks and
uncertainties.  We intend that these forward-looking statements
be covered by the safe harbor provisions for forward-looking
statements contained in the Private Securities Litigation Reform
Act of 1995.  These forward-looking statements are often
accompanied in this Report by words such as "believe," "plan,"
"anticipate," "project," "expect," "estimate," and similar
expressions.  These forward-looking statements are based on
management's current expectations and are subject to risks,
uncertainties and changes in circumstances.  These forward-
looking statements are not guarantees of future performance.
Actual results may differ materially from the expectations
described in this Report due to, among other things, the factors
detailed in our Annual Report on Form 10-K under the caption
"Factors That May Affect Future Results of Operations."  We are
under no obligation, and expressly disclaim any obligation, to
update or alter these forward-looking statements whether as a
result of new information, future events or otherwise.

Results of operations

Revenues

The following table sets forth revenue (in thousands) by funding
type and product group for the three month periods ended March
31, 2001 and 2000:

                                         Three months ended March 31,
Underwritten premium revenue:                 2001         2000
   PPO                                     $106,019       $79,666
   POS                                       59,689        46,486
   HMO (includes other POS)                  37,690        56,320
   Medicare supplement                       21,996        22,796
   Managed indemnity                            689           685
   Other specialty services                  20,738        14,389
      Total premium revenue                 246,821       220,342
Self-funded PPO/POS, HMO and ASO revenue
   (includes HealthLink and other income)    33,933        28,632
Non-affiliated real estate rental income        832           653
      Total fees and other income            34,765        29,285
      Total revenues                       $281,586      $249,627

Operating ratios

The following table sets forth selected operating ratios.  The
medical cost ratio reflects health care services expense as a
percentage of premium revenue.  All other ratios are shown as a
percentage of total revenues:


                                  Three months ended March 31,
                                        2001      2000
Operating revenue ratios:
  Premium revenue                       87.7%     88.3%
  Self-funded fees and other income     12.0%     11.5%
  Non-affiliated rental income           0.3%      0.2%
                                       100.0%    100.0%
Operating ratios:
  Medical cost ratio                    81.3%     81.4%
  Commission expense ratio               3.7%      3.6%
  General and administrative            18.9%     19.6%
     expense ratio
  Adjusted general and administrative
     expense ratio (excludes depreciation
     and amortization)                  17.0%     17.6%

Membership

The following table sets forth the number of members by funding
type and product group:

                                                            %
                                        March 31,        Increase/
                                  2001           2000   (Decrease)

Underwritten:
  PPO                           247,389         210,138     17.7
  POS                           146,958         134,051      9.6
  HMO (includes other POS)       86,008         128,574   (33.1)
  Medicare supplement            48,350          51,863    (6.8)
  Managed indemnity               1,548           1,596    (3.0)
     Total underwritten
        membership              530,253         526,222      0.8
Self-funded:
  PPO/POS                        57,380          44,308     29.5
  HMO                             5,065           7,633   (33.6)
  ASO (includes HealthLink):
   Workers' compensation        782,800         639,765     22.4
   Other ASO(1)               1,426,794       1,350,266      5.7
     Total self-funded
        membership            2,272,039       2,041,972     11.3

Total membership              2,802,292       2,568,194      9.1

(1)Does not include 569,875 and 434,633 additional third-party
 administrator members as of March 31, 2001 and 2000,
 respectively, that are part of The EPOCH Group, L.C. (EPOCH), a
 joint venture with Blue Cross and Blue Shield of Kansas City
 formed in December 1995.  The membership above does include
 195,387 and 160,593 members of EPOCH as of March 31, 2001 and
 2000, respectively, whose employers are primarily located in
 our Blue Cross and Blue Shield service area.  Our share of the
 earnings of EPOCH is included within the caption, "Other
 expense, net" in the Consolidated Statements of Income.


COMPARISON OF RESULTS FOR FIRST QUARTER 2001 TO FIRST QUARTER 2000

Revenues

Underwritten

Premium revenue increased $26.5 million, or 12.0%, to $246.8
million in the first quarter of 2001 from $220.3 million in the
first quarter of 2000.  As described below, components of premium
revenue were affected by shifts in product mix, rate increases,
enrollment growth, and other factors.  As a result, such increase
in premium revenue may not be indicative of future periods.  We
will continue to strive to establish premium rates based on
anticipated health care costs.  Depending on future competition,
customer acceptance of premium increases, future health care cost
trends and other factors, we cannot provide any assurances that
we will be able to price the products of our subsidiaries in
excess of health care cost trends.

In the early part of 2000, several of our competitors
announced their intention to exit the Missouri market, which is our primary
sales area.  A reduction in the number of competitors for the
Missouri market share has had a positive impact on our ability to
attract and maintain membership.  We cannot, however, provide any
assurances that we will continue to attract or retain membership.
Our membership has also benefited from our participation in the
BlueCard(R) PPO program.  The BlueCard(R) PPO program allows our
Alliance PPO and POS members access to Blue Cross and Blue Shield
plans' providers throughout essentially all of the United States
and 200 countries worldwide.

PPO premium revenue, including our Illinois PPO products and
Federal Employee Program, increased approximately $26.3 million,
or 33.1%, to $106.0 million in the first quarter of 2001 from
$79.7 million in the first quarter of 2000 -- $16.1 million due to
a 19.4% increase in member months and a $10.2 million increase
resulting from an 11.5% increase in net premium rates.  The term
member months refers to the cumulative number of members added
together over a specific time period.  Thus, for a quarter, member
months are determined by adding together the membership counts for
all three months.  Net premium rates increased due in part to our
premium renewal rate increases, which are affected by medical cost
inflation, changes in deductibles, the timing of group renewals
throughout the year and product mix changes.  Member months
increases reflect the membership growth in our PPO products that
we began offering in Illinois under the RightCHOICE of Illinois
brand at the end of the first quarter of 1997.  Included in the
number of underwritten PPO members are 31,660 PPO Illinois members
as of March 31, 2001, an increase of 13,480 members from March 31,
2000.  Also, member months increased due to an increase in large
group sales partially due to the popularity of the aforementioned
BlueCard(R) PPO program.  PPO premium revenue for the Federal
Employee Program increased $3.9 million, or 18.8%, to $24.8 million
in the first quarter of 2001 from $20.9 million in the first quarter
of 2000.  Federal Employee Program revenue typically fluctuates based on
actual administrative costs incurred and claims submitted.  The
increase in the Federal Employee Program revenue is primarily due
to the increase in related claims costs of approximately $3.8
million.

POS premium revenue, which includes our AllianceChoice and
AlliancePreferred group and individual products, increased $13.2
million, or 28.4%, to $59.7 million for the first quarter of 2001
from $46.5 million for the first quarter of 2000 --  $7.4 million
of the increase due to a 16.1% increase in net premium rates and
$5.8 million of the increase resulting from a 10.6% increase in
member months.  Net premium rates increased due in part to
premium renewal rate increases which are affected by medical cost
inflation, changes in deductibles, the timing of group renewals
throughout the year and product mix changes.  We began offering
our AlliancePreferred POS products in January 2001.
AlliancePreferred POS offers the same benefits and service area
as AllianceChoice POS, but with a complementary network of
providers.  We had approximately 1,300 members enrolled in
AlliancePreferred POS as of March 31, 2001.

HMO (including other POS) premium revenue decreased $18.6
million, or 33.1%, to $37.7 million in the first quarter of 2001
from $56.3 million in the first quarter of 2000 primarily due to
the planned and intentional termination, effective December 31,
2000, of our participation in the Missouri Consolidated Health
Care Plan (MCHCP) and Blue Horizons Medicare HMO.  Excluding
these two programs, premium revenue increased approximately $3.0
million, or 8.8%, to $37.7 million in the first quarter of 2001
from $34.7 million in the first quarter of 2000, primarily due to
an 8.4% increase in net premium rates.  Membership in underwritten
HMO (and other POS) products declined by 42,566 members from March
31, 2000 to March 31, 2001.  However, excluding the two
aforementioned terminated programs, membership increased by 3,885
members over this same time period.

Medicare supplement premium revenue decreased by $0.8 million, or
3.5%, to $22.0 million in the first quarter of 2001 from $22.8
million in the first quarter of 2000 -- $1.7 million of the
decrease resulting from a 7.3% decrease in member months,
partially offset by a $0.9 million increase due to a 4.0%
increase in net premium rates.

Membership in our Medicare supplement products has decreased in
part due to subscribers opting for competitors' Medicare-risk HMO
programs in which medical benefits are at least as comprehensive
as benefits for persons eligible to receive benefits under a
Medicare supplement program.  These Medicare-risk HMO programs
have historically been offered at either no additional cost to
the member or at a lower cost than our Medicare supplement
products.

Managed indemnity premium revenue remained unchanged at $0.7
million for the first quarter of 2001 and the first quarter of
2000.  Net premium rates increased 11.6% offset by a 9.9% decline
in member months.  Member month declines are consistent with our
strategy to move toward more managed health care products.  With
the exception of a short-term medical product, we no longer sell
managed indemnity products, but we continue to renew coverage for
those members who wish to remain in these managed indemnity
programs.

Other specialty services premium revenue, which is derived from
our PPO and POS group pharmacy plans as well as all of our group
dental benefit plans, increased $6.3 million, or 44.1%, to $20.7
million in the first quarter of 2001 from $14.4 million in the
first quarter of 2000 -- $3.2 million of the increase as a result
of a 16.4% increase in member months and $3.1 million resulting
from a 23.8% increase in net premium rates.  Specialty product
membership related to our pharmacy products increased during this
period as a result of growth in the our underwritten membership.
The increase in membership for pharmacy products was offset
slightly by decreases in our dental product member months, which
decreased by 15.1% due to competition from dental products that
have lower premiums than our dental product.  We do not
separately report membership related to other specialty services
in our total underwritten membership because these members are
already counted as members of our other underwritten products.
The 23.8% increase in net premium rates primarily relates to our
pharmacy products and corresponds to the high levels of
prescription utilization and trends that our company, as well as
the industry as a whole, have experienced in recent years.

Self-funded

Fees and other income from administrative services only, self-
funded network services and life insurance commission revenues
increased $5.3 million, or 18.5%, to $33.9 million in the first
quarter of 2001 from $28.6 million in the first quarter of 2000.
This increase is partially due to increased revenues of $1.8
million from HealthLink, Inc. (HealthLink), our network rental
and managed care service subsidiary.  HealthLink's increase in
revenues was partially due to expansion into new territories,
membership growth in HealthLink's managed health care and
workers' compensation programs, as well as increases in client
access fees.  Our BlueCard(R) PPO and National Account ASO revenues
increased by $1.1 million due to a 20.6% increase in member
months.  In addition, our self-funded PPO/POS and PPO network
rental revenues (non-HealthLink) increased by $1.9 million in the
first quarter of 2001 as compared to the first quarter of 2000
due in part to an 8.9% increase in member months.

Other income

Rental income related to non-affiliated tenants increased to $0.8
million in the first quarter of 2001 from $0.7 million in the
first quarter of 2000.

Operating expenses

Our medical cost ratio decreased to 81.3% in the first quarter of
2001 from 81.4% in the first quarter of 2000.  The medical cost
ratio represents health care services expense divided by premium
revenue.  The medical cost ratio in the first quarter of 2001 is
lower compared to that in the first quarter of 2000 due in part
to the our pricing strategy, which resulted in an overall
increase in the premium per member per month of approximately
10.9% in the first quarter of 2001 as compared to the first
quarter of 2000.  The medical expense on a per member per month
basis increased by approximately 10.8% in the first quarter of
2001 as compared to the first quarter of 2000.  Inclusive in the
medical expense on a per member per month basis in the first
quarter of 2001 is a pharmacy cost trend increase in the
low twenty percent range which was driven by a combination
of factors, including introduction of new drug therapies,
physicians' use of newer, more expensive drugs, and greater
utilization of drugs driven in part by direct-to-consumer
advertising.  Approximately 95% of our underwritten members with
a pharmacy benefit participate in a three-tier copayment program
that encourages members and physicians to use the most cost-
effective drugs in a drug class.  We manage our medical costs
through a variety of medical management programs.

Commission expense increased by approximately $1.6 million, or
17.1%, to $10.5 million in the first quarter of 2001 from $8.9
million in the first quarter of 2000.  The commission expense
ratio increased to 3.7% for the first quarter of 2001 from 3.6%
for the first quarter of 2000.  This ratio represents commission
expense divided by total revenues.  The increase in commission
expense in the first quarter of 2001 is primarily due to an
increase in overall premium and membership as compared to the
first quarter of 2000.  In addition, the increase in the
commission expense ratio is partially due to the aforementioned
termination of MCHCP.  MCHCP premium revenue, which was not
subject to commission expense, was $14.6 million in the first
quarter of 2000.

General and administrative expenses, excluding depreciation and
amortization, increased $4.1 million, or 9.3%, to $47.9 million
in the first quarter of 2001 from $43.8 million in the first
quarter of 2000.  The increase in these expenses is partially
attributable to HealthLink's geographic and member expansion
efforts, which resulted in increased HealthLink expenses of $0.5
million in the first quarter of 2001 as compared to the first
quarter of 2000.  The increase in general and administrative
expenses is also attributable to an increase of $0.6 million in
corporate initiative expenses for corporate projects such as our
efforts to comply with the Health Insurance Portability and
Accountability Act (HIPAA) and our software migration to FACETS(R),
a newer client server software package to handle our primary
transaction functions.  Additional general and administrative
expense increases relate to an increase in our overall membership
of 9.1% (6.9% excluding HealthLink).

Our general and administrative expense ratio, excluding
depreciation and amortization, decreased to 17.0% in the first
quarter of 2001 from 17.6% in the first quarter of 2000.  The
ratio represents general and administrative expenses, excluding
depreciation and amortization, divided by total revenues.  The
decrease of 0.6% reflects our continued focus on cost containment
and increased economies of scale associated with premium and
revenue growth in the first quarter of 2001.

Depreciation and amortization expenses increased to $5.5 million
in the first quarter of 2001 from $5.0 million in the first
quarter of 2000.  During the first quarter of 2001, we amortized
$0.4 million of the goodwill and intangible assets resulting from
our Reorganization on November 30, 2000, as described in Note 2,
"Organization," in the Notes to Consolidated Financial
Statements.

Operating expenses for our underwritten segment include health
care service costs, commissions, and general and administrative
expenses attributable to that segment's operations.  Operating
expenses for the self-funded segment include commissions and
general and administrative expenses attributable to that segment.
Operating expenses for the other segment include general and
administrative expenses primarily related to our real estate
activities.  Operating expenses for the underwritten segment
increased $25.8 million to $244.0 million in the first quarter of
2001 from $218.2 million in the first quarter of 2000 primarily
due to an increase in health care service costs of $21.4 million.
Health care service costs increased due primarily to an increase
in our per member claims costs, as previously described, as well
as an overall increase in underwritten membership of
approximately one percent.  General and administrative and
commission expenses also increased by $2.9 million and $1.5
million, respectively, in the first quarter of 2001 as compared
to the first quarter of 2000.  These increases were also
partially attributable to the increase in our underwritten
membership as well as an increase in corporate initiative
expenses in the first quarter of 2001.  As previously noted, the
commission expense increased due to increased premiums as well as
the impact of gaining new underwritten membership that is subject
to commission expense while terminating the MCHCP membership that
was not subject to commission expense.  Operating expenses for
the self-funded segment increased $1.4 million to $20.5 million
in the first quarter of 2001 from $19.1 million in the first
quarter of 2000.  This increase was partially due to an increase
in HealthLink's general and administrative expenses of
$0.5 million, as previously described.  In addition, general and
administrative expenses related to our non-HealthLink products
increased $0.9 million due largely to the increase in our other
self-funded membership, as previously described.  Operating
expenses for the other segment increased to $1.2 million in the
first quarter of 2001 from $1.1 million in the first quarter of
2000.

Operating income

Operating income increased $4.5 million, or 36.1%, to $17.0
million in the first quarter of 2001 from $12.5 million in the
first quarter of 2000.

Operating income for our underwritten segment increased $0.7
million, or 32.2%, to $2.9 million in the first quarter of 2001
from $2.2 million in the first quarter of 2000.  The improvement
was primarily due to the improved general and administrative
expense and medical cost ratios.

Operating income for our self-funded segment increased $3.8
million, or 39.5%, to $13.3 million in the first quarter of 2001
from $9.5 million in the first quarter of 2000.  This improvement
is due partially to HealthLink's continued profit growth from
increased membership and regional expansion, as previously
described.  The increase in operating income is also due to the
increase in our other self-funded membership, as previously
described.

Operating income for the other segment remained unchanged at $0.8
million in the first quarters of 2001 and 2000.

Net investment income

Net investment income increased $1.0 million, or 24.5%, to $5.1
million in the first quarter of 2001 from $4.1 million in the
first quarter of 2000, as a result of comparatively higher cash
and investment levels in 2001 as well as an increase of $0.6
million in net realized gains.  Net investment income includes
investment income in the form of interest and dividend income and
net realized gains or losses from the sale of portfolio
securities.

Other, net

Other, net expenses decreased $0.1 million, or 10.8%, to $0.8
million in the first quarter of 2001 from $0.9 million in the
first quarter of 2000.  Other, net includes interest expense,
realized gains and losses from the sale of property and
equipment, equity in unconsolidated affiliates, and other items.
Interest expense decreased by $0.1 million in the first quarter
of 2001 as compared to the first quarter of 2000 primarily due to
a reduction in the total amount of debt outstanding under our
credit facility.

Minority interest in consolidated subsidiary

The charge for the minority interest in the first quarter of 2000
relates to the public minority stockholders' interest in the
results of operations of RightCHOICE Managed Care, Inc., a
Missouri corporation (Old RightCHOICE), as further described in
Note 2, "Organization," of the Notes to Consolidated Financial
Statements.  The public minority stockholders consisted of the
holders of the 3.7 million class A common shares of Old
RightCHOICE, which represented approximately 20% of the total
outstanding shares of Old RightCHOICE.

Provision for income taxes

Our effective income tax provision rate was 39.8% and 40.5% for
the first quarters of 2001 and 2000, respectively.  Our effective
income tax rates for the first quarters of 2001 and 2000 were
affected by non-deductible goodwill amortization, among other
things.  Statement of Financial Accounting Standards No. 109,
"Accounting for Income Taxes," requires a valuation allowance
against deferred tax assets if, based on the weight of available
evidence, it is more likely than not that some or all of the
deferred tax assets will not be realized.  Based upon all the
available evidence, we believe it is more likely than not that we
will realize our deferred tax assets as of March 31, 2001, and,
accordingly, no valuation allowance has been provided against
such assets as of March 31, 2001.

Net income

Our net income for the first quarter of 2001 increased $5.0
million, or 63.2%, to $12.8 million as compared to net income of
$7.8 million for the first quarter of 2000 as a result of the
factors noted above.  Basic and diluted earnings per share for
the first quarter of 2001 were $0.68 and $0.67, respectively,
compared to basic and diluted earnings per share for the first
quarter of 2000 of $0.52 and $0.52, respectively.  Earnings per
share for the quarter ended March 31, 2001 are based upon weighted
average shares outstanding of approximately 18.7 million,
excluding potential common stock, and 19.2 million, assuming
full dilution.  Earnings per share for the quarter ended March 31, 2000 are
based on 15.0 million shares, excluding potential common stock, and 15.2
million shares, assuming full dilution.  The increase in weighted average
shares outstanding in the first quarter of 2001 compared to the
first quarter of 2000 primarily relates to the effect of the
Reorganization on November 30, 2000 which resulted in the
issuance of 3.7 million shares as further described in Note 2,
"Organization," of the Notes to Consolidated Financial
Statements.  In addition, for weighted average shares outstanding
assuming full dilution, the increase in the first quarter of 2001
was primarily due to the aforementioned Reorganization as well as
the impact of a higher stock price during the first quarter of
2001 as compared to the first quarter of 2000.

Liquidity and Capital Resources

Our working capital as of March 31, 2001 was $138.0 million, a
decrease of $5.4 million from $143.4 million as of December 31,
2000.  The decrease is mainly due to our debt of $24.1 million
under our credit facility that is classified as a current
liability as of March 31, 2001.  As of December 31, 2000, the
current portion of this debt was $6.0 million.  Excluding this
$18.1 million increase in the current portion of our debt, our
working capital increased by $12.7 million.  The increase is
partially attributable to the net income of $12.8 million in the
first quarter of 2001.  Depreciation and amortization expenses
related to noncurrent assets was $5.5 million.  We capitalized
$3.9 million of costs for property and equipment purchases, $2.9
million of which relates to capitalized software and capitalized
internally developed software.  The purchased software and internally
developed software consist of our information and operations strategy
development (FACETS(R) software migration), compliance efforts related
to HIPAA, and internet development.  Our unrealized depreciation of
investments available for sale, net of tax, decreased (improved) by $0.8
million in the first quarter of 2001.  In addition, we repaid
$2.0 million of the debt from our credit facility as well as $1.1
million of debt related to our capital leases.

Net cash provided by operations totaled $17.6 million for the
first quarter of 2001 as compared to $6.0 million for the first
quarter of 2000.  For the first quarter of 2001, our net income
was $12.8 million, which included $5.5 million of depreciation
and amortization expenses.  In addition, receivables, accounts
payable and accrued expenses, medical claims payable, and income
taxes payable were affected by the timing of cash payments and
receipts as well as changes in membership and net premium rates
and claims payments.  Receivables decreased by $7.8 million in part
due to a net reduction in underwritten membership of approximately
24,000 members (inclusive of the aforementioned MCHCP and Blue
Horizons Medicare HMO members) from December 31, 2000 to
March 31, 2001, a decrease of $1.1 million related to HealthLink's
receivables, as well as other timing factors.  Accounts payable
and accrued expenses decreased by $9.7 million due in large part
to annual broker bonuses that are paid in the first quarter of
each year as well as payments made to our employees pursuant
to the our annual incentive programs.  Medical claims payable
decreased by $3.7 million, due in part to the reduction in
underwritten membership from December 31, 2000 to March 31, 2001,
as previously stated.  Income taxes payable increased by
$9.2 million due to the timing of quarterly estimated tax payments.

Stock offering

On May 7, 2001, the Foundation and our company completed a sale
of 4,000,000 shares of our common stock.  Of the total, 3,250,000
shares were sold by the Foundation.  We did not receive any
proceeds from this sale of shares by the Foundation.  We sold
750,000 shares of common stock which resulted in net proceeds to
our company of approximately $26.6 million after deducting the
underwriting discounts and commissions and other expenses.  The
proceeds of the sale of these shares were used primarily to repay
the remaining $24.1 million of borrowed funds outstanding under
our credit facility.  Upon repayment of these borrowings on May
7, 2001, our credit facility was terminated.  The remaining net
proceeds from our stock sale will be used for capital
expenditures and other general corporate purposes.  On May 10,
2001, the Foundation sold an additional 600,000 shares pursuant
to the underwriters' over-allotment option.  We did not receive
any proceeds from this sale of shares by the Foundation.  After
these sales, the Foundation owned approximately 11.1 million
shares, or approximately 57% of our outstanding common stock as
of May 10, 2001.  A voting trust holds approximately 92% of the
Foundation's shares as of May 10, 2001.

Health Insurance Portability and Accountability Act of 1996

The United States Department of Health and Human Services has
issued rules, as mandated by the Health Insurance Portability and
Accountability Act of 1996, known as HIPAA, which would, among
other things, impose security and privacy requirements with
respect to individually identifiable patient data, including a
member's transactions with health care providers and payors, as
well as requirements for the standardization of certain
electronic transaction code sets and provider identifiers.  The
privacy standards were issued on December 28, 2000, and the final
privacy regulations became effective on April 14, 2001.  The
compliance date is April 14, 2003.  We anticipate expending
approximately $4 million to $5 million in 2001, of which
approximately $2 million to $3 million will be capitalized,
related to our efforts to comply with the electronic transaction
code sets and provider identifier standards.  The current
compliance date for the transaction code sets is October 16,
2002.  In the first quarter of 2001, we have expended
approximately $0.7 million, of which approximately $0.3 million
has been capitalized.  We have not fully assessed the additional
financial impact related to compliance with security and patient
information privacy standards.  We believe, however, the
additional financial impact could be material.

Recently issued accounting standards

See the description under the same caption in Note 4 of the Notes
to Consolidated Financial Statements of Item I, which is
incorporated herein by reference.

Contingencies

See the description under the same caption in Note 3 of the Notes
to Consolidated Financial Statements of Item I, which is
incorporated herein by reference.

ITEM 3.     Quantitative and Qualitative Disclosures About Market Risks

There have been no material changes in market risk exposures that
affect the quantitative and qualitative disclosures presented in
our annual report on Form 10-K for the year ended December 31,
2000.

PART II.    OTHER INFORMATION

ITEM 1.     Legal Proceedings

Note 3, "Contingencies," of Part I, Item 1, contains a
description of various pending and threatened claims involving
the company and its affiliates and is incorporated herein by
reference.  See the description of this litigation under the
headings "Litigation with the Missouri Attorney General and
Missouri Department of Insurance," "Litigation relating to
corporate status of Blue Cross and Blue Shield of Missouri,"
"Litigation relating to Medicare supplement premiums," and "Other
contingencies."

ITEM 2.     Changes in Securities and Use of Proceeds

            None.

ITEM 3.     Defaults Upon Senior Securities

            None.

ITEM 4.     Submission of Matters to a Vote of Security Holders

            None.

ITEM 5.     Other Information

            None.

ITEM 6.     Exhibits and Reports on Form 8-K

     a)     Exhibits:

Exhibit
Number      Exhibit

The following exhibits are submitted herewith:

10.1        Amended and Restated Lease, dated as of May 1, 2001,
between Forty-Four Forty-Four Forest Park Redevelopment
Corporation and RightCHOICE Managed Care, Inc.

10.2        Amendment to Building Services Agreement, dated as of May 1,
2001, by and between Forty-Four Forty-Four Forest Park
Redevelopment Corporation and RightCHOICE Managed Care, Inc.

     b)     Reports on Form 8-K:

The company filed a report with the SEC on Form 8-K/A on January
29, 2001.  This amendment included certain financial statements
and pro forma financial information which were not available at
the time of the filing of the 8-K report that was filed on
December 15, 2000.  The company's report on Form 8-K filed on
December 15, 2000 related to the completion of the Reorganization
of Blue Cross and Blue Shield of Missouri, the company, The
Missouri Foundation For Health and RightCHOICE Managed Care Inc.
(a Missouri corporation) which occurred on November 30, 2000.


                             SIGNATURES











Pursuant to the requirements of the Securities Exchange Act of
1934,  the registrant has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.



                               RIGHTCHOICE MANAGED CARE, INC.
                               Registrant


Date:  May 14, 2001                     By:  /s/   Sandra Van Trease
                                        Sandra Van Trease
                                        President, Chief Operating Officer
                                        and Chief Financial Officer

Date:  May 14, 2001                     By:  /s/  Stuart K. Campbell
                                        Stuart K. Campbell
                                        Senior Vice President,
                                        Finance